Vertex Energy Announces First Quarter 2024 Results and Optimization of Hydrocracking Capacity From Renewables to Conventional Production
The Company will host a conference call to discuss first quarter 2024 results today, at
Highlights for the first quarter of 2024 and through the date of this press release include:
-
Continued safe operation of the Company’s
Mobile, Alabama refinery (the “Mobile Refinery”) with first quarter 2024 conventional throughput of 64,065 barrels per day (bpd), above the high end of prior guidance; -
Reduced net loss attributable to the Company to
($17.7) million , or ($0.19 ) per fully-diluted share compared to the fourth quarter 2023; -
Increased Adjusted EBITDA to
$18.6 million driven by 28% improvement in crack spreads compared to the fourth quarter of 2023; - Decreased direct operating expense by 11% and capital expenditures by 29% compared to previous guidance midpoints;
- Achieved renewable diesel (“RD”) throughput of 4,090 bpd, in line with previous guidance; and
-
Reported total cash and cash equivalents of
$65.7 million , including restricted cash of$3.6 million .
Highlights for the strategic redirection of the Company’s renewable business:
-
Announced a production pause and pivot regarding the Company’s renewable business;
-
Optimizing the
Mobile Refinery hydrocracker capacity from renewable diesel to conventional fuels; - Expect to deplete Company inventories of renewable feedstocks prior to the conversion;
- Conversion will be timed with a planned catalyst change and maintenance turnaround that was already scheduled for 2024, after which hydrocracker production is expected to contribute additional upgraded conventional product volumes in Q4 2024; and
- Opportunity to optimize hydrocracker production in conventional service while maintaining the proven renewable diesel production flexibility when market conditions warrant.
-
Optimizing the
Note: Schedules reconciling the Company’s generally accepted accounting principles in
Mr.
“Over the past few years, we have made material advancements and strategic decisions to grow Vertex. For the past two years we have operated safely and efficiently while investing capital into upgrading the
Total conventional throughput at the
The Mobile Refinery’s conventional operations generated a gross profit of
Total renewable throughput at the Mobile Renewable Diesel facility was 4,090 bpd in the first quarter of 2024. Total production of renewable diesel was 4,003 bpd reflecting a product yield of 98%.
The Mobile Renewable Diesel facility operations generated a gross loss of
Renewable Business Pause and Pivot
During the second quarter of 2024, Vertex is pausing renewable fuels production and redirecting the hydrocracking unit to conventional fuels and products. The Company had a previously planned catalyst and maintenance turnaround scheduled for 2024. It will use that planned turnaround to load conventional catalyst and bring the unit out of turnaround in conventional service. In addition, the total cost of about
First Quarter 2024 Mobile Refinery Results Summary ($/millions unless otherwise noted)
|
4Q23 |
TTM |
1Q24 |
|
|
|
|
Total Throughput (bpd) |
67,083 |
71,922 |
64,065 |
Total Throughput (MMbbl) |
6.17 |
26.32 |
5.83 |
Conventional Facility Capacity Utilization1 |
89.4% |
95.9% |
85.4% |
|
|
|
|
Direct Opex Per Barrel ($/bbl) |
|
|
|
Fuel Gross Margin ($/MM) |
|
|
|
Fuel Gross Margin Per Barrel ($/bbl) |
|
|
|
|
|
|
|
Production Yield |
|
|
|
Gasoline (bpd) |
17,826 |
17,388 |
14,678 |
% Production |
25.9% |
24.0% |
22.9% |
ULSD (bpd) |
14,510 |
15,014 |
13,441 |
% Production |
21.1% |
21.6% |
21.0% |
Jet (bpd) |
12,937 |
13,735 |
12,595 |
% Production |
18.8% |
19.8% |
19.6% |
Total Finished Fuel Products |
45,273 |
46,137 |
40,714 |
% Production |
65.9% |
63.7% |
63.5% |
Other2 |
23,457 |
26,300 |
23,428 |
% Production |
34.1% |
37.9% |
36.5% |
Total Production (bpd) |
68,730 |
72,437 |
64,142 |
Total Production (MMbbl) |
6.32 |
26.51 |
5.84 |
|
|
|
|
|
4Q23 |
TTM |
1Q24 |
|
|
|
|
Total Renewable Throughput (bpd) |
3,926 |
3,980 |
4,090 |
Total Renewable Throughput (MMbbl) |
0.36 |
1.46 |
0.37 |
Renewable Diesel Facility Capacity Utilization3 |
49.1% |
49.8% |
51.1% |
|
|
|
|
Direct Opex Per Barrel ($/bbl) |
|
|
|
Renewable Fuel Gross Margin |
|
|
|
Renewable Fuel Gross Margin Per Barrel ($/bbl) |
|
|
|
|
|
|
|
Renewable Diesel Production (bpd) |
3,786 |
3,822 |
4,003 |
Renewable Diesel Production (MMbbl) |
0.35 |
1.40 |
0.36 |
Renewable Diesel Production Yield (%) |
96.4% |
96.0% |
97.9% |
1) Assumes 75,000 barrels per day of conventional operational capacity 2) Other includes naphtha, intermediates, and LNG 3) Assumes 8,000 barrels per day of renewable fuels operational capacity |
First Quarter 2024 Financial Update
Vertex reported first quarter 2024 net loss attributable to the Company of
Balance Sheet and Liquidity Update
As of
As previously announced on
Vertex management continuously monitors current market conditions to assess expected cash generation and liquidity needs against its available cash position, using the forward crack spreads in the market. Additionally, the Company continues to evaluate strategic financial opportunities seeking further enhancements to its current liquidity position.
Management Outlook
All guidance presented below is current as of the time of this release and is subject to change. All prior financial guidance should no longer be relied upon.
|
2Q 2024 |
||
Operational: |
Low |
High |
|
Mobile Refinery Conventional Throughput Volume (Mbpd) |
68.0 |
72.0 |
|
Capacity Utilization |
91% |
96% |
|
Production Yield Profile: |
|
|
|
Percentage Finished Products1 |
64% |
68% |
|
Intermediate & Other Products2 |
36% |
32% |
|
|
|||
|
2Q 2024 |
||
Operational: |
Low |
High |
|
Mobile Refinery Renewable Throughput Volume (Mbpd) |
2.0 |
4.0 |
|
Capacity Utilization |
25% |
50% |
|
Production Yield |
96% |
98% |
|
Yield Loss |
4% |
2% |
|
Consolidated |
2Q 2024 |
||
Operational: |
Low |
|
High |
Mobile Refinery Total Throughput Volume (Mbpd) |
70.0 |
|
76.0 |
Capacity Utilization |
84% |
|
92% |
|
|
|
|
Financial Guidance: |
|
|
|
Direct Operating Expense ($/bbl) |
|
|
|
Capital Expenditures ($/MM) |
|
|
|
|
|
|
|
1.) Finished products include gasoline, ULSD, and Jet A |
|||
2.) Intermediate & Other products include Vacuum Gas Oil (VGO), Liquified Petroleum Gases (LPGs), and Vacuum Tower Bottoms (VTBs) |
CONFERENCE CALL AND WEBCAST DETAILS
A conference call will be held today,
To participate in the live teleconference:
Domestic: (888) 350-3870
International: (646) 960-0308
Conference ID: 8960754
A replay of the teleconference will be available in the “Events and Presentation” section of Vertex’s website at www.vertexenergy.com for up to one year following the conference call.
ABOUT
FORWARD-LOOKING STATEMENTS
Certain of the matters discussed in this communication which are not statements of historical fact constitute forward-looking statements within the meaning of the securities laws, including the Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties. Words such as “strategy,” “expects,” “continues,” “plans,” “anticipates,” “believes,” “would,” “will,” “estimates,” “intends,” “projects,” “goals,” “targets” and other words of similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying these statements. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. The important factors that may cause actual results and outcomes to differ materially from those contained in such forward-looking statements include, without limitation, the Company’s projected Outlook for the second quarter of 2024, the costs associated with, and outcome of the Company’s plans to optimize conventional fuel and renewable diesel production moving forward,, as discussed above; statements concerning: the Company’s engagement of
Other important factors that may cause actual results and outcomes to differ materially from those contained in the forward-looking statements included in this communication are described in the Company’s publicly filed reports, including, but not limited to, the Company’s Annual Report on Form 10-K for the year ended
PROJECTIONS
The financial projections (the “Projections”) included herein were prepared by Vertex in good faith using assumptions believed to be reasonable. A significant number of assumptions about the operations of the business of Vertex were based, in part, on economic, competitive, and general business conditions prevailing at the time the Projections were developed. Any future changes in these conditions, may materially impact the ability of Vertex to achieve the financial results set forth in the Projections. The Projections are based on numerous assumptions, including realization of the operating strategy of Vertex; industry performance; no material adverse changes in applicable legislation or regulations, or the administration thereof, or generally accepted accounting principles; general business and economic conditions; competition; retention of key management and other key employees; absence of material contingent or unliquidated litigation, indemnity, or other claims; minimal changes in current pricing; static material and equipment pricing; no significant increases in interest rates or inflation; and other matters, many of which will be beyond the control of Vertex, and some or all of which may not materialize. The Projections also assume the continued uptime of the Company’s facilities at historical levels and the successful funding of, timely completion of, and successful outcome of, planned capital projects. Additionally, to the extent that the assumptions inherent in the Projections are based upon future business decisions and objectives, they are subject to change. Although the Projections are presented with numerical specificity and are based on reasonable expectations developed by Vertex’s management, the assumptions and estimates underlying the Projections are subject to significant business, economic, and competitive uncertainties and contingencies, many of which will be beyond the control of Vertex. Accordingly, the Projections are only estimates and are necessarily speculative in nature. It is expected that some or all of the assumptions in the Projections will not be realized and that actual results will vary from the Projections. Such variations may be material and may increase over time. In light of the foregoing, readers are cautioned not to place undue reliance on the Projections. The projected financial information contained herein should not be regarded as a representation or warranty by Vertex, its management, advisors, or any other person that the Projections can or will be achieved. Vertex cautions that the Projections are speculative in nature and based upon subjective decisions and assumptions. As a result, the Projections should not be relied on as necessarily predictive of actual future events.
NON-GAAP FINANCIAL MEASURES AND KEY PERFORMANCE INDICATORS
In addition to our results calculated under generally accepted accounting principles in
Each of the Non-
For more information on these non-GAAP financial measures and KPIs, please see the sections titled “Unaudited Reconciliation of Gross Profit (Loss) From Continued and Discontinued Operations to Adjusted Gross Margin, Fuel Gross Margin, Fuel Gross Margin Per Barrel of Throughput and Operating Expenses Per Barrel of Throughput”, “Unaudited Reconciliation of Adjusted EBITDA to Net loss from Continued and Discontinued Operations”, and “Unaudited Reconciliation of Long-Term Debt to Net Long-Term Debt and Net Leverage”, at the end of this release.
|
|||||||
CONSOLIDATED BALANCE SHEETS |
|||||||
(in thousands, except number of shares and par value) |
|||||||
(UNAUDITED) |
|||||||
|
|
|
|
||||
ASSETS |
|
|
|
||||
Current assets |
|
|
|
||||
Cash and cash equivalents |
$ |
62,140 |
|
|
$ |
76,967 |
|
Restricted cash |
|
3,609 |
|
|
|
3,606 |
|
Accounts receivable, net |
|
41,559 |
|
|
|
36,164 |
|
Inventory |
|
198,979 |
|
|
|
182,120 |
|
Prepaid expenses and other current assets |
|
38,673 |
|
|
|
53,174 |
|
Total current assets |
|
344,960 |
|
|
|
352,031 |
|
|
|
|
|
||||
Fixed assets, net |
|
332,949 |
|
|
|
326,111 |
|
Finance lease right-of-use assets |
|
63,524 |
|
|
|
64,499 |
|
Operating lease right-of use assets |
|
78,802 |
|
|
|
96,394 |
|
Intangible assets, net |
|
10,789 |
|
|
|
11,541 |
|
Other assets |
|
4,029 |
|
|
|
4,048 |
|
TOTAL ASSETS |
$ |
835,053 |
|
|
$ |
854,624 |
|
|
|
|
|
||||
LIABILITIES AND EQUITY |
|
|
|
||||
Current liabilities |
|
|
|
||||
Accounts payable |
$ |
69,796 |
|
|
$ |
75,004 |
|
Accrued expenses and other current liabilities |
|
69,240 |
|
|
|
73,636 |
|
Finance lease liability-current |
|
2,497 |
|
|
|
2,435 |
|
Operating lease liability-current |
|
13,281 |
|
|
|
20,296 |
|
Current portion of long-term debt, net |
|
12,524 |
|
|
|
16,362 |
|
Obligations under inventory financing agreements, net |
|
169,656 |
|
|
|
141,093 |
|
Total current liabilities |
|
336,994 |
|
|
|
328,826 |
|
|
|
|
|
||||
Long-term debt, net |
|
177,772 |
|
|
|
170,701 |
|
Finance lease liability-long-term |
|
65,576 |
|
|
|
66,206 |
|
Operating lease liability-long-term |
|
64,345 |
|
|
|
74,444 |
|
Deferred tax liabilities |
|
2,776 |
|
|
|
2,776 |
|
Derivative warrant liability |
|
3,249 |
|
|
|
9,907 |
|
Other liabilities |
|
1,377 |
|
|
|
1,377 |
|
Total liabilities |
|
652,089 |
|
|
|
654,237 |
|
|
|
|
|
||||
EQUITY |
|
|
|
||||
Common stock, |
|
||||||
750,000,000 shares authorized; 93,514,346 and 93,514,346 shares issued and outstanding at |
|
94 |
|
|
94 |
|
|
Additional paid-in capital |
|
384,063 |
|
|
|
383,632 |
|
Accumulated deficit |
|
(205,113 |
) |
|
|
(187,379 |
) |
|
|
179,044 |
|
|
|
196,347 |
|
Non-controlling interest |
|
3,920 |
|
|
|
4,040 |
|
Total equity |
|
182,964 |
|
|
|
200,387 |
|
TOTAL LIABILITIES AND EQUITY |
$ |
835,053 |
|
|
$ |
854,624 |
|
||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||
(in thousands, except per share amounts) |
||||||||
(UNAUDITED) |
||||||||
|
|
Three Months Ended |
||||||
|
|
2024 |
|
2023 |
||||
Revenues |
|
$ |
695,326 |
|
|
$ |
691,142 |
|
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
|
|
652,034 |
|
|
|
619,352 |
|
Depreciation and amortization attributable to costs of revenues |
|
|
8,186 |
|
|
|
4,337 |
|
Gross profit |
|
|
35,106 |
|
|
|
67,453 |
|
|
|
|
|
|
||||
Operating expenses: |
|
|
|
|
||||
Selling, general and administrative expenses (exclusive of depreciation and amortization shown separately below) |
|
|
39,782 |
|
|
|
41,942 |
|
Depreciation and amortization attributable to operating expenses |
|
|
1,104 |
|
|
|
1,016 |
|
Total operating expenses |
|
|
40,886 |
|
|
|
42,958 |
|
Income (loss) from operations |
|
|
(5,780 |
) |
|
|
24,495 |
|
Other income (expense): |
|
|
|
|
||||
Other income (expenses) |
|
|
(1,049 |
) |
|
|
1,653 |
|
Gain (loss) on change in value of derivative warrant liability |
|
|
6,658 |
|
|
|
(9,185 |
) |
Interest expense |
|
|
(17,683 |
) |
|
|
(12,477 |
) |
Total other expense |
|
|
(12,074 |
) |
|
|
(20,009 |
) |
Income (loss) from continuing operations before income tax |
|
|
(17,854 |
) |
|
|
4,486 |
|
Income tax expense |
|
|
— |
|
|
|
(1,013 |
) |
Income (loss) from continuing operations |
|
|
(17,854 |
) |
|
|
3,473 |
|
Income from discontinued operations, net of tax (see note 22) |
|
|
— |
|
|
|
50,340 |
|
Net income (loss) |
|
|
(17,854 |
) |
|
|
53,813 |
|
Net loss attributable to non-controlling interest from continuing operations |
|
|
(120 |
) |
|
|
(50 |
) |
Net income (loss) attributable to |
|
|
(17,734 |
) |
|
|
53,863 |
|
|
|
|
|
|
||||
Net income (loss) attributable to common shareholders from continuing operations |
|
|
(17,734 |
) |
|
|
3,523 |
|
Net income attributable to common shareholders from discontinued operations, net of tax |
|
|
— |
|
|
|
50,340 |
|
Net income (loss) attributable to common shareholders |
|
$ |
(17,734 |
) |
|
$ |
53,863 |
|
|
|
|
|
|
||||
Basic income (loss) per common share |
|
|
|
|
||||
Continuing operations |
|
$ |
(0.19 |
) |
|
$ |
0.05 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
0.66 |
|
Basic income (loss) per common share |
|
$ |
(0.19 |
) |
|
$ |
0.71 |
|
|
|
|
|
|
||||
Diluted income (loss) per common share |
|
|
|
|
||||
Continuing operations |
|
$ |
(0.19 |
) |
|
$ |
0.04 |
|
Discontinued operations, net of tax |
|
|
— |
|
|
|
0.64 |
|
Diluted income (loss) per common share |
|
$ |
(0.19 |
) |
|
$ |
0.68 |
|
|
|
|
|
|
||||
Shares used in computing earnings per share |
|
|
|
|
||||
Basic |
|
|
93,514 |
|
|
|
75,689 |
|
Diluted |
|
|
93,514 |
|
|
|
78,996 |
|
|
|||||||||||||||||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY |
|||||||||||||||||||
(in thousands, except par value) |
|||||||||||||||||||
(UNAUDITED) |
|||||||||||||||||||
|
|||||||||||||||||||
Three Months Ended |
|||||||||||||||||||
|
Common Stock |
|
|
|
|
|
|
|
|
||||||||||
|
Shares |
|
|
|
|
|
Accumulated Deficit |
|
Non-controlling Interest |
|
Total Equity |
||||||||
Balance on |
93,515 |
|
$ |
94 |
|
$ |
383,632 |
|
$ |
(187,379 |
) |
|
$ |
4,040 |
|
|
$ |
200,387 |
|
Stock based compensation expense |
— |
|
|
— |
|
|
431 |
|
|
— |
|
|
|
— |
|
|
|
431 |
|
Net loss |
— |
|
|
— |
|
|
— |
|
|
(17,734 |
) |
|
|
(120 |
) |
|
|
(17,854 |
) |
Balance on |
93,515 |
|
$ |
94 |
|
$ |
384,063 |
|
$ |
(205,113 |
) |
|
$ |
3,920 |
|
|
$ |
182,964 |
|
Three Months Ended |
|||||||||||||||||||
|
Common Stock |
|
|
|
|
|
|
|
|
||||||||||
|
Shares |
|
|
|
|
|
Accumulated Deficit |
|
Non-controlling Interest |
|
Total Equity |
||||||||
Balance on |
75,670 |
|
$ |
76 |
|
$ |
279,552 |
|
$ |
(115,893 |
) |
|
$ |
1,685 |
|
|
$ |
165,420 |
|
Exercise of options |
166 |
|
|
— |
|
|
209 |
|
|
— |
|
|
|
— |
|
|
|
209 |
|
Stock based compensation expense |
— |
|
|
— |
|
|
365 |
|
|
— |
|
|
|
— |
|
|
|
365 |
|
Non-controlling shareholder contribution |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
980 |
|
|
|
980 |
|
Net income (loss) |
— |
|
|
— |
|
|
— |
|
|
53,863 |
|
|
|
(50 |
) |
|
|
53,813 |
|
Balance on |
75,836 |
|
$ |
76 |
|
$ |
280,126 |
|
$ |
(62,030 |
) |
|
$ |
2,615 |
|
|
$ |
220,787 |
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(in thousands) |
|||||||
(UNAUDITED) |
|||||||
|
Three Months Ended |
||||||
|
|
|
|
||||
Cash flows from operating activities |
|
|
|
||||
Net income (loss) |
$ |
(17,854 |
) |
|
$ |
53,813 |
|
Income from discontinued operations, net of tax |
|
— |
|
|
|
50,340 |
|
Income (loss) from continuing operations |
|
(17,854 |
) |
|
|
3,473 |
|
Adjustments to reconcile net loss from continuing operations to cash used in operating activities |
|
|
|
||||
Stock based compensation expense |
|
431 |
|
|
|
365 |
|
Depreciation and amortization |
|
9,290 |
|
|
|
5,353 |
|
Deferred income tax expense |
|
— |
|
|
|
1,013 |
|
Loss on lease modification |
|
35 |
|
|
|
— |
|
Loss on sale of assets |
|
691 |
|
|
|
3 |
|
Increase in allowance for credit losses |
|
19 |
|
|
|
882 |
|
Increase (decrease) in fair value of derivative warrant liability |
|
(6,658 |
) |
|
|
9,185 |
|
(Gain) loss on commodity derivative contracts |
|
1,322 |
|
|
|
(1,516 |
) |
Net cash settlements on commodity derivatives |
|
(2,292 |
) |
|
|
3,519 |
|
Amortization of debt discount and deferred costs |
|
4,758 |
|
|
|
4,572 |
|
Changes in operating assets and liabilities |
|
|
|
||||
Accounts receivable and other receivables |
|
(4,180 |
) |
|
|
(26,291 |
) |
Inventory |
|
(16,859 |
) |
|
|
(52,553 |
) |
Prepaid expenses and other current assets |
|
14,710 |
|
|
|
(18,103 |
) |
Accounts payable |
|
(5,250 |
) |
|
|
11,005 |
|
Accrued expenses |
|
(7,308 |
) |
|
|
22,486 |
|
Other assets |
|
19 |
|
|
|
(44 |
) |
Net cash used in operating activities from continuing operations |
|
(29,126 |
) |
|
|
(36,651 |
) |
Cash flows from investing activities |
|
|
|
||||
Purchase of fixed assets |
|
(14,726 |
) |
|
|
(73,936 |
) |
Proceeds from sale of discontinued operation |
|
— |
|
|
|
87,238 |
|
Proceeds from sale of fixed assets |
|
2,576 |
|
|
|
— |
|
Net cash provided by (used in) investing activities from continuing operations |
|
(12,150 |
) |
|
|
13,302 |
|
Cash flows from financing activities |
|
|
|
||||
Payments on finance leases |
|
(586 |
) |
|
|
(310 |
) |
Proceeds from exercise of options and warrants to common stock |
|
— |
|
|
|
209 |
|
Contributions received from noncontrolling interest |
|
— |
|
|
|
980 |
|
Net change on inventory financing agreements |
|
28,313 |
|
|
|
(11,284 |
) |
Proceeds from note payable |
|
3,175 |
|
|
|
— |
|
Payments on note payable |
|
(4,450 |
) |
|
|
(17,165 |
) |
Net cash provided by (used in) financing activities from continuing operations |
|
26,452 |
|
|
|
(27,570 |
) |
|
|
|
|
||||
Discontinued operations: |
|
|
|
||||
Net cash provided by (used in) operating activities |
|
— |
|
|
|
(150 |
) |
Net cash provided by (used in) discontinued operations |
|
— |
|
|
|
(150 |
) |
|
|
|
|
||||
Net decrease in cash, cash equivalents and restricted cash |
|
(14,824 |
) |
|
|
(51,069 |
) |
Cash, cash equivalents, and restricted cash at beginning of the period |
|
80,573 |
|
|
|
146,187 |
|
Cash, cash equivalents, and restricted cash at end of period |
$ |
65,749 |
|
|
$ |
95,118 |
|
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the consolidated balance sheets to the same amounts shown in the consolidated statements of cash flows (in thousands).
|
|||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(in thousands) |
|||||||
(UNAUDITED) |
|||||||
(Continued) |
|||||||
|
Three Months Ended |
||||||
|
|
|
|
||||
|
|
|
|
||||
Cash and cash equivalents |
$ |
62,140 |
|
|
$ |
86,689 |
|
Restricted cash |
|
3,609 |
|
|
|
8,429 |
|
Cash and cash equivalents and restricted cash as shown in the consolidated statements of cash flows |
$ |
65,749 |
|
|
$ |
95,118 |
|
|
|
|
|
||||
SUPPLEMENTAL INFORMATION |
|
|
|
||||
Cash paid for interest |
$ |
4,811 |
|
|
$ |
10,124 |
|
Cash paid for taxes |
$ |
— |
|
|
$ |
— |
|
|
|
|
|
||||
NON-CASH INVESTING AND FINANCING TRANSACTIONS |
|
|
|
||||
ROU assets obtained from new finance leases |
$ |
18 |
|
|
$ |
15,024 |
|
ROU assets obtained from new operating leases |
$ |
74 |
|
|
$ |
15,078 |
|
ROU assets disposed under operating leases |
$ |
(17,666 |
) |
|
$ |
— |
Unaudited segment information for the three months ended
THREE MONTHS ENDED |
||||||||||||||||
|
|
Refining & Marketing |
|
Black Oil & Recovery |
|
Corporate and Eliminations |
|
Total |
||||||||
Revenues: |
|
|
|
|
|
|
|
|
||||||||
Refined products |
|
$ |
650,759 |
|
|
$ |
31,724 |
|
|
$ |
(1,022 |
) |
|
$ |
681,461 |
|
Re-refined products |
|
|
3,867 |
|
|
|
5,215 |
|
|
|
— |
|
|
|
9,082 |
|
Services |
|
|
3,081 |
|
|
|
1,702 |
|
|
|
— |
|
|
|
4,783 |
|
Total revenues |
|
|
657,707 |
|
|
|
38,641 |
|
|
|
(1,022 |
) |
|
|
695,326 |
|
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
|
|
622,974 |
|
|
|
30,082 |
|
|
|
(1,022 |
) |
|
|
652,034 |
|
Depreciation and amortization attributable to costs of revenues |
|
|
6,541 |
|
|
|
1,645 |
|
|
|
— |
|
|
|
8,186 |
|
Gross profit |
|
|
28,192 |
|
|
|
6,914 |
|
|
|
— |
|
|
|
35,106 |
|
Selling, general and administrative expenses |
|
|
26,147 |
|
|
|
5,397 |
|
|
|
8,238 |
|
|
|
39,782 |
|
Depreciation and amortization attributable to operating expenses |
|
|
793 |
|
|
|
72 |
|
|
|
239 |
|
|
|
1,104 |
|
Income (loss) from operations |
|
|
1,252 |
|
|
|
1,445 |
|
|
|
(8,477 |
) |
|
|
(5,780 |
) |
Other income (expenses) |
|
|
|
|
|
|
|
|
||||||||
Other expense |
|
|
(685 |
) |
|
|
(359 |
) |
|
|
(5 |
) |
|
|
(1,049 |
) |
Gain on change in derivative liability |
|
|
— |
|
|
|
— |
|
|
|
6,658 |
|
|
|
6,658 |
|
Interest expense |
|
|
(4,747 |
) |
|
|
(96 |
) |
|
|
(12,840 |
) |
|
|
(17,683 |
) |
Total other expense |
|
|
(5,432 |
) |
|
|
(455 |
) |
|
|
(6,187 |
) |
|
|
(12,074 |
) |
Income (loss) from continuing operations before income tax |
|
$ |
(4,180 |
) |
|
$ |
990 |
|
|
$ |
(14,664 |
) |
|
$ |
(17,854 |
) |
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures |
|
$ |
11,299 |
|
|
$ |
3,427 |
|
|
$ |
— |
|
|
$ |
14,726 |
|
THREE MONTHS ENDED |
||||||||||||||||
|
|
Refining & Marketing |
|
Black Oil & Recovery |
|
Corporate and Eliminations |
|
Total |
||||||||
Revenues: |
|
|
|
|
|
|
|
|
||||||||
Refined products |
|
$ |
653,042 |
|
|
$ |
29,423 |
|
|
$ |
(2,733 |
) |
|
$ |
679,732 |
|
Re-refined products |
|
|
4,353 |
|
|
|
4,411 |
|
|
|
— |
|
|
|
8,764 |
|
Services |
|
|
1,933 |
|
|
|
713 |
|
|
|
— |
|
|
|
2,646 |
|
Total revenues |
|
|
659,328 |
|
|
|
34,547 |
|
|
|
(2,733 |
) |
|
|
691,142 |
|
Cost of revenues (exclusive of depreciation and amortization shown separately below) |
|
|
589,812 |
|
|
|
30,418 |
|
|
|
(878 |
) |
|
|
619,352 |
|
Depreciation and amortization attributable to costs of revenues |
|
|
3,294 |
|
|
|
1,043 |
|
|
|
— |
|
|
|
4,337 |
|
Gross profit |
|
|
66,222 |
|
|
|
3,086 |
|
|
|
(1,855 |
) |
|
|
67,453 |
|
Selling, general and administrative expenses |
|
|
26,486 |
|
|
|
4,799 |
|
|
|
10,657 |
|
|
|
41,942 |
|
Depreciation and amortization attributable to operating expenses |
|
|
808 |
|
|
|
38 |
|
|
|
170 |
|
|
|
1,016 |
|
Income (loss) from operations |
|
|
38,928 |
|
|
|
(1,751 |
) |
|
|
(12,682 |
) |
|
|
24,495 |
|
Other income (expenses) |
|
|
|
|
|
|
|
|
||||||||
Other income (expense) |
|
|
— |
|
|
|
1,655 |
|
|
|
(2 |
) |
|
|
1,653 |
|
Loss on change in derivative liability |
|
|
— |
|
|
|
— |
|
|
|
(9,185 |
) |
|
|
(9,185 |
) |
Interest expense |
|
|
(3,876 |
) |
|
|
(57 |
) |
|
|
(8,544 |
) |
|
|
(12,477 |
) |
Total other income (expense) |
|
|
(3,876 |
) |
|
|
1,598 |
|
|
|
(17,731 |
) |
|
|
(20,009 |
) |
Income (loss) from continuing operations before income tax |
|
$ |
35,052 |
|
|
$ |
(153 |
) |
|
$ |
(30,413 |
) |
|
$ |
4,486 |
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures |
|
$ |
69,908 |
|
|
$ |
4,028 |
|
|
$ |
— |
|
|
$ |
73,936 |
|
Unaudited Reconciliation of Gross Profit (Loss) From Continued and Discontinued Operations to Adjusted Gross Margin, Fuel Gross Margin, Fuel Gross Margin Per Barrel of Throughput and Operating Expenses Per Barrel of Throughput.
Three Months Ended |
|||||||||||
In thousands |
Conventional |
Renewable |
Mobile Refinery Total |
||||||||
Gross profit |
$ |
37,508 |
|
$ |
(10,462 |
) |
$ |
27,047 |
|
||
Unrealized (gain) loss on hedging activities |
|
(555 |
) |
|
934 |
|
|
379 |
|
||
Inventory valuation adjustments |
|
9,657 |
|
|
4,592 |
|
|
14,249 |
|
||
Adjusted gross margin |
$ |
46,610 |
|
$ |
(4,936 |
) |
$ |
41,674 |
|
||
Variable production costs attributable to cost of revenues |
|
25,651 |
|
|
6,846 |
|
|
32,497 |
|
||
Depreciation and amortization attributable to cost of revenues |
|
2,558 |
|
|
3,932 |
|
|
6,490 |
|
||
RINs |
|
(857 |
) |
|
- |
|
|
(857 |
) |
||
Realized (gain) loss on hedging activities |
|
2,577 |
|
|
(1,783 |
) |
|
794 |
|
||
Financing costs |
|
(172 |
) |
|
132 |
|
|
(40 |
) |
||
Other revenues |
|
(2,719 |
) |
|
(362 |
) |
|
(3,081 |
) |
||
Fuel gross margin |
$ |
73,648 |
|
$ |
3,829 |
|
$ |
77,477 |
|
||
Throughput (bpd) |
|
64,065 |
|
|
4,090 |
|
|
68,155 |
|
||
Fuel gross margin per barrel of throughput |
$ |
12.63 |
|
$ |
10.29 |
|
$ |
12.49 |
|
||
Total OPEX |
$ |
16,061 |
|
$ |
9,382 |
|
$ |
25,443 |
|
||
Operating expenses per barrel of throughput |
$ |
2.75 |
|
$ |
25.21 |
|
$ |
4.10 |
|
Three Months Ended |
|||||||||||
In thousands |
Conventional |
Renewable |
Mobile Refinery Total |
||||||||
Gross profit |
$ |
7,283 |
|
$ |
(17,557 |
) |
$ |
(10,273 |
) |
||
Unrealized (gain) loss on hedging activities |
|
4,892 |
|
|
77 |
|
|
4,969 |
|
||
Inventory valuation adjustments |
|
(3,400 |
) |
|
2,152 |
|
|
(1,248 |
) |
||
Adjusted gross margin |
$ |
8,775 |
|
$ |
(15,328 |
) |
$ |
(6,553 |
) |
||
Variable production costs attributable to cost of revenues |
|
19,770 |
|
|
19,497 |
|
|
39,267 |
|
||
Depreciation and amortization attributable to cost of revenues |
|
2,492 |
|
|
3,997 |
|
|
6,489 |
|
||
RINs |
|
6,662 |
|
|
- |
|
|
6,662 |
|
||
Realized (gain) loss on hedging activities |
|
(3,751 |
) |
|
(3,587 |
) |
|
(7,338 |
) |
||
Financing costs |
|
1,989 |
|
|
157 |
|
|
2,146 |
|
||
Other revenues |
|
(6,361 |
) |
|
(361 |
) |
|
(6,722 |
) |
||
Fuel gross margin |
$ |
29,576 |
|
$ |
4,375 |
|
$ |
33,951 |
|
||
Throughput (bpd) |
|
67,083 |
|
|
3,926 |
|
|
71,009 |
|
||
Fuel gross margin per barrel of throughput |
$ |
4.79 |
|
$ |
12.11 |
|
$ |
5.20 |
|
||
Total OPEX |
$ |
15,162 |
|
$ |
9,868 |
|
$ |
25,030 |
|
||
Operating expenses per barrel of throughput |
$ |
2.46 |
|
$ |
27.32 |
|
$ |
3.83 |
|
Twelve Months Ended |
|||||||||||
In thousands |
Conventional |
Renewable |
Mobile Refinery Total |
||||||||
Gross profit |
$ |
137,519 |
|
$ |
(49,540 |
) |
$ |
87,979 |
|
||
Unrealized (gain) loss on hedging activities |
|
566 |
|
|
302 |
|
|
868 |
|
||
Inventory valuation adjustments |
|
15,236 |
|
|
6,638 |
|
|
21,874 |
|
||
Adjusted gross margin |
$ |
153,321 |
|
$ |
(42,600 |
) |
$ |
110,721 |
|
||
Variable production costs attributable to cost of revenues |
|
100,954 |
|
|
39,378 |
|
|
140,332 |
|
||
Depreciation and amortization attributable to cost of revenues |
|
11,383 |
|
|
13,267 |
|
|
24,650 |
|
||
RINs |
|
38,273 |
|
|
- |
|
|
38,273 |
|
||
Realized (gain) loss on hedging activities |
|
530 |
|
|
(1,681 |
) |
|
(1,151 |
) |
||
Financing costs |
|
3,502 |
|
|
552 |
|
|
4,054 |
|
||
Other revenues |
|
(19,494 |
) |
|
(1,437 |
) |
|
(20,931 |
) |
||
Fuel gross margin |
$ |
288,469 |
|
$ |
7,479 |
|
$ |
295,948 |
|
||
Throughput (bpd) |
|
71,922 |
|
|
3,980 |
|
|
75,901 |
|
||
Fuel gross margin per barrel of throughput |
$ |
10.96 |
|
$ |
5.13 |
|
$ |
10.65 |
|
||
Total OPEX |
$ |
72,242 |
|
$ |
37,771 |
|
$ |
110,013 |
|
||
Operating expenses per barrel of throughput |
$ |
2.74 |
|
$ |
25.93 |
|
$ |
3.96 |
|
Unaudited Reconciliation of Adjusted EBITDA to Net loss from Continued and Discontinued Operations.
In thousands |
Three Months Ended |
Twelve Months Ended |
||||||||||||||
|
|
|
|
|||||||||||||
Net income (loss) |
$ |
(17,854 |
) |
$ |
53,813 |
|
$ |
(143,641 |
) |
$ |
56,619 |
|
||||
Depreciation and amortization |
|
9,290 |
|
|
5,498 |
|
|
35,102 |
|
|
22,527 |
|
||||
Income tax expense (benefit) |
|
- |
|
|
18,759 |
|
|
(13,462 |
) |
|
16,269 |
|
||||
Interest expense |
|
17,683 |
|
|
12,477 |
|
|
124,773 |
|
|
88,192 |
|
||||
EBITDA |
$ |
9,119 |
|
$ |
90,547 |
|
$ |
2,772 |
|
$ |
183,607 |
|
||||
Unrealized (gain) loss on hedging activities |
|
445 |
|
|
(255 |
) |
|
448 |
|
|
(133 |
) |
||||
Inventory valuation adjustments |
|
14,249 |
|
|
(1,532 |
) |
|
21,874 |
|
|
49,234 |
|
||||
Gain on change in value of derivative warrant liability |
|
(6,658 |
) |
|
9,185 |
|
|
(23,835 |
) |
|
(2,215 |
) |
||||
Stock-based compensation |
|
430 |
|
|
365 |
|
|
2,350 |
|
|
1,689 |
|
||||
(Gain) loss on sale of assets |
|
691 |
|
|
(67,741 |
) |
|
(2,446 |
) |
|
(67,325 |
) |
||||
Acquisition costs |
|
- |
|
|
4,308 |
|
|
- |
|
|
16,275 |
|
||||
Environmental clean-up reserve |
|
- |
|
|
- |
|
|
- |
|
|
1,428 |
|
||||
Other |
|
358 |
|
|
0 |
|
|
(276 |
) |
|
280 |
|
||||
Adjusted EBITDA |
$ |
18,634 |
|
$ |
34,877 |
|
$ |
887 |
|
$ |
182,841 |
|
|
Three Months Ended |
|
|
|
|
||||||||||||||||||||||
|
|
Legacy Refining & Marketing |
Total Refining & Marketing |
Black Oil and Recovery |
Corporate |
Consolidated |
|||||||||||||||||||||
In thousands |
Conventional |
Renewable |
|
|
|
|
|
||||||||||||||||||||
Net income (loss) |
$ |
17,535 |
|
$ |
(22,157 |
) |
$ |
442 |
$ |
(4,180 |
) |
$ |
990 |
$ |
(14,664 |
) |
$ |
(17,854 |
) |
||||||||
Depreciation and amortization |
|
3,330 |
|
|
3,953 |
|
|
51 |
|
7,334 |
|
|
1,717 |
|
239 |
|
|
9,290 |
|
||||||||
Income tax expense (benefit) |
|
- |
|
|
- |
|
|
- |
|
- |
|
|
- |
|
- |
|
|
- |
|
||||||||
Interest expense |
|
2,455 |
|
|
2,292 |
|
|
- |
|
4,747 |
|
|
96 |
|
12,840 |
|
|
17,683 |
|
||||||||
EBITDA |
$ |
23,320 |
|
$ |
(15,912 |
) |
$ |
493 |
$ |
7,901 |
|
$ |
2,803 |
$ |
(1,585 |
) |
$ |
9,119 |
|
||||||||
Unrealized (gain) loss on hedging activities |
|
(555 |
) |
|
934 |
|
|
20 |
|
399 |
|
|
46 |
|
- |
|
|
445 |
|
||||||||
Inventory valuation adjustments |
|
9,657 |
|
|
4,592 |
|
|
- |
|
14,249 |
|
|
- |
|
- |
|
|
14,249 |
|
||||||||
Gain on change in value of derivative warrant liability |
|
- |
|
|
- |
|
|
- |
|
- |
|
|
- |
|
(6,658 |
) |
|
(6,658 |
) |
||||||||
Stock-based compensation |
|
- |
|
|
- |
|
|
- |
|
- |
|
|
- |
|
430 |
|
|
430 |
|
||||||||
(Gain) loss on sale of assets |
|
685 |
|
|
- |
|
|
- |
|
685 |
|
|
5 |
|
1 |
|
|
691 |
|
||||||||
Other |
|
- |
|
|
- |
|
|
- |
|
- |
|
|
354 |
|
4 |
|
|
358 |
|
||||||||
Adjusted EBITDA |
$ |
33,107 |
|
$ |
(10,386 |
) |
$ |
513 |
$ |
23,234 |
|
$ |
3,208 |
$ |
(7,808 |
) |
$ |
18,634 |
|
|
Three Months Ended |
|
|
||||||||||||||||||||||||
|
|
Legacy Refining & Marketing |
Total Refining & Marketing |
Black Oil and Recovery |
Corporate |
Consolidated |
|||||||||||||||||||||
In thousands |
Conventional |
Renewable |
|
|
|
|
|
||||||||||||||||||||
Net income (loss) |
$ |
(11,112 |
) |
$ |
(30,266 |
) |
$ |
(2,424 |
) |
$ |
(43,801 |
) |
$ |
(1,670 |
) |
$ |
(18,395 |
) |
$ |
(63,865 |
) |
||||||
Depreciation and amortization |
|
3,252 |
|
|
4,017 |
|
|
313 |
|
|
7,582 |
|
|
1,476 |
|
|
167 |
|
|
9,225 |
|
||||||
Income tax expense (benefit) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(517 |
) |
|
2,060 |
|
|
1,543 |
|
||||||
Interest expense |
|
2,473 |
|
|
2,820 |
|
|
- |
|
|
5,293 |
|
|
62 |
|
|
10,675 |
|
|
16,029 |
|
||||||
EBITDA |
$ |
(5,387 |
) |
$ |
(23,429 |
) |
$ |
(2,111 |
) |
$ |
(30,926 |
) |
$ |
(649 |
) |
$ |
(5,493 |
) |
$ |
(37,068 |
) |
||||||
Unrealized (gain) loss on hedging activities |
|
4,892 |
|
|
77 |
|
|
(7 |
) |
|
4,962 |
|
|
19 |
|
|
- |
|
|
4,981 |
|
||||||
Inventory valuation adjustments |
|
(3,400 |
) |
|
2,152 |
|
|
- |
|
|
(1,248 |
) |
|
- |
|
|
- |
|
|
(1,248 |
) |
||||||
Gain on change in value of derivative warrant liability |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(2,956 |
) |
|
(2,956 |
) |
||||||
Stock-based compensation |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
783 |
|
|
783 |
|
||||||
(Gain) loss on sale of assets |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
3 |
|
|
3 |
|
||||||
Acquisition costs |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
||||||
Other |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
389 |
|
|
(1 |
) |
|
388 |
|
||||||
Adjusted EBITDA |
$ |
(3,895 |
) |
$ |
(21,200 |
) |
$ |
(2,118 |
) |
$ |
(27,212 |
) |
$ |
(241 |
) |
$ |
(7,664 |
) |
$ |
(35,117 |
) |
|
Twelve Months Ended |
|
|||||||||||||||||||||||||
|
|
Legacy Refining & Marketing |
Total Refining & Marketing |
Black Oil and Recovery |
Corporate |
Consolidated |
|||||||||||||||||||||
In thousands |
Conventional |
Renewable |
|
|
|
|
|
||||||||||||||||||||
Net income (loss) |
$ |
49,932 |
$ |
(94,694 |
) |
$ |
(4,782 |
) |
$ |
(49,544 |
) |
$ |
48,246 |
|
$ |
(142,343 |
) |
$ |
(143,641 |
) |
|||||||
Depreciation and amortization |
|
14,387 |
|
13,343 |
|
|
932 |
|
|
28,662 |
|
|
5,700 |
|
|
740 |
|
|
35,102 |
|
|||||||
Income tax expense (benefit) |
|
- |
|
- |
|
|
- |
|
|
- |
|
|
18,682 |
|
|
(32,144 |
) |
|
(13,462 |
) |
|||||||
Interest expense |
|
11,656 |
|
7,307 |
|
|
- |
|
|
18,963 |
|
|
227 |
|
|
105,583 |
|
|
124,773 |
|
|||||||
EBITDA |
$ |
75,975 |
$ |
(74,044 |
) |
$ |
(3,850 |
) |
$ |
(1,919 |
) |
$ |
72,855 |
|
$ |
(68,164 |
) |
$ |
2,772 |
|
|||||||
Unrealized (gain) loss on hedging activities |
|
566 |
|
302 |
|
|
(2 |
) |
|
866 |
|
|
(418 |
) |
|
- |
|
|
448 |
|
|||||||
Inventory valuation adjustments |
|
15,236 |
|
6,638 |
|
|
- |
|
|
21,874 |
|
|
- |
|
|
- |
|
|
21,874 |
|
|||||||
Gain on change in value of derivative warrant liability |
|
- |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(23,835 |
) |
|
(23,835 |
) |
|||||||
Stock-based compensation |
|
- |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
2,350 |
|
|
2,350 |
|
|||||||
(Gain) loss on sale of assets |
|
685 |
|
- |
|
|
- |
|
|
685 |
|
|
(69,224 |
) |
|
66,093 |
|
|
(2,446 |
) |
|||||||
Other |
|
- |
|
- |
|
|
- |
|
|
- |
|
|
(241 |
) |
|
(35 |
) |
|
(276 |
) |
|||||||
Adjusted EBITDA |
$ |
92,462 |
$ |
(67,104 |
) |
$ |
(3,852 |
) |
$ |
21,506 |
|
$ |
2,972 |
|
$ |
(23,591 |
) |
$ |
887 |
|
Unaudited Reconciliation of Long-Term Debt to Net Long-Term Debt and Net Leverage.
In thousands |
As of |
||||||||||
|
|
|
|
||||||||
Long-Term Debt: |
|
|
|
||||||||
Senior Convertible Note |
$ |
15,230 |
|
$ |
95,178 |
|
$ |
15,230 |
|
||
Term Loan 2025 |
|
195,950 |
|
|
152,138 |
|
|
195,950 |
|
||
Promissory Note |
|
2,612 |
|
|
- |
|
|
- |
|
||
Finance lease liability long-term |
|
65,576 |
|
|
59,325 |
|
|
66,206 |
|
||
Finance lease liability short-term |
|
2,497 |
|
|
1,916 |
|
|
2,435 |
|
||
Insurance premiums financed |
|
2,399 |
|
|
1,359 |
|
|
6,237 |
|
||
Long-Term Debt and Lease Obligations |
$ |
284,264 |
|
$ |
309,916 |
|
$ |
286,058 |
|
||
Unamortized discount and deferred financing costs |
|
(25,893 |
) |
|
(77,596 |
) |
|
(30,354 |
) |
||
Long-Term Debt and Lease Obligations per Balance Sheet |
$ |
258,371 |
|
$ |
232,320 |
|
$ |
255,704 |
|
||
Cash and Cash Equivalents |
|
(62,140 |
) |
|
(86,689 |
) |
|
(76,967 |
) |
||
Restricted Cash |
|
(3,609 |
) |
|
(8,429 |
) |
|
(3,606 |
) |
||
Total Cash and Cash Equivalents |
$ |
(65,749 |
) |
$ |
(95,118 |
) |
$ |
(80,573 |
) |
||
Net Long-Term Debt |
$ |
218,515 |
|
$ |
214,798 |
|
$ |
205,485 |
|
||
Adjusted EBITDA |
$ |
887 |
|
$ |
182,898 |
|
$ |
17,130 |
|
||
Net Leverage |
246.4x |
1.2x |
12.0x |
Note: Net Leverage is calculated using trailing twelve months Adjusted EBITDA
View source version on businesswire.com: https://www.businesswire.com/news/home/20240509304436/en/
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IR@vertexenergy.com
Source: